Andhra Pradesh goes the transparency way. Will other states and the Centre take the cue?
The AFF doesn't reveal tax proposals but highlights the government's development strategy and investment priorities. It shows allocations for some 200-odd government departments but leaves room for secretaries and heads of departments to re-prioritise funds. "Each department has been allocated its pot of money, now it is up to them to decide how they want to spend it," says finance secretary S.K. Arora.
The move has received a warm welcome. "The people are the biggest gainers as it gives them an opportunity to say where they want funds spent," says Mahender Reddy, professor, Osmania University. However, says former economic affairs secretary E.A.S. Sarma: "The AP experiment is good in principle but the purpose is defeated if what has been published hides more than it reveals."
"We've reversed the budget-making process. The document has set the fiscal parameters by announcing the deficit figure and setting the government's borrowing limits," says Arora. Except for tax issues, he feels, there is no need for secrecy in the budget. Even former rbi chief M. Narasimham hopes the Andhra experiment will pave the way for the Centre and other states to follow.
The figures, though, are educative. The AP economy has grown at 7.3 per cent over the last three years against the national average of 6.1 per cent. But the good news ends there. Debt will rise from Rs 35,246 crore in 2000-01 to Rs 42,556 crore, or 28.6 per cent of state gdp, and over 30 per cent in the next fiscal. Per capita income has climbed 5.7 per cent but still leaves over 15 per cent of the people below the poverty line, another highest. There's also a dip in welfare spending and power and rice subsidies are to be further cut. The Opposition's been quick to pounce on all this.